Small vs. Big

As a small business lender at a community bank, I find myself empathetic to the anti-big business or anti-big bank sentiments that I used to tune out. No, corporations are not really people, they are corporations. By definition a corporation is a business entity created by individuals and is governed by law and the tax code. They have powers separate from the originating individuals and corporate liabilities or obligations are isolated from the founders and shareholders.

But corporations are essentially composed of people. Forget complicated structures like off-shore shell corporations that don't have a location or legitimate purpose and think of GE, GM, and P & G. Thousands of jobs, hundreds of products or services, and global reach.

And the success or failure of corporations directly impact a lot of people in very tangible ways.

But corporations are not created equal: there are big ones, small ones, and some as big as your head. Big companies don't descend from space overnight, they are grown slowly over decades (ignore Google please) and usually start as a small operation. Somewhere along the way, they sometimes lose touch with reality and the real people they serve.

This happens a lot in the banking world; for a humorous example, watch this commercial:



In the Washington Post today (yes I occasionally venture across the aisle read the Post) there was a whiny article about Capital One's impending merger with ING. If you've never heard of either, don't worry they're just big banks. But there was one good point in the article:

"What does concern me, however, is that even more of the nation’s bank deposits will be channeled to small businesses through corporate credit cards rather than through loans made by flesh-and-blood bankers. Why is that important? Simply put, because only bankers with deep understanding of industries, communities and customers can be relied on not to push cheap and easy loans during credit booms and then abruptly cut off credit lines or raise rates at the first sign of economic trouble."

I'm not sure what my point is...maybe that flesh-and-blood bankers are better than zombie bankers? Later in the article the point is made that there is such a thing as too many corporate (well, bank) consolidations and at some point it needs to stop. My thought is that the market will sort it out and that is by far preferable then an less than appealing congressman pretending he knows better.

At least bankers with blood hug their customers. Well, I really don't get hugs from bakery owners (or any business owner really...).